WOLF - 1 Chip Stock to Avoid and 2 Chip Stocks to Consider for 2023
Semiconductor stocks are on an upswing in the last few months. As measured by the iShares Semiconductor ETF , shares of chip companies are up some 40% since their lows in October 2022. Investors are peering beyond the current cyclical downturn (led by flagging smartphone and PC sales) and looking toward a rally in the back half of 2023. With a decade of strong growth expected for the industry, small semiconductor companies could hold a lot of promise.
But not every chip business is in the same boat. Wolfspeed (NYSE: WOLF) is going through some serious growing pains, but it still trades for a premium price. Onto Innovation (NYSE: ONTO) and SkyWater Technology (NASDAQ: SKYT) , on the other hand, are forecasting better times ahead. Here are the details on these small emerging semiconductor companies and why two are worth considering and a third is one to avoid.
Silicon is almost synonymous with the chip industry. The base material is abundant around the globe, and it is an ideal semiconductive material that was put to use in chip technology right from the get-go when modern "chips" were invented in the 1940s and 1950s. In reality, though, the chemistry behind producing the basic materials for computing systems is much more complex than simple silicon.
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1 Chip Stock to Avoid and 2 Chip Stocks to Consider for 2023